Questions:
1. What is a cost object? Identify four different cost objects in which an accountant would be interested.
2. Why is cost accumulation imprecise?
3. If the cost object is a manufactured product, what are the three major cost categories to accumulate?
4. What is a direct cost? What criteria are used to determine whether a cost is a direct cost?
5. Why are the terms direct cost and indirect cost independent of the terms fixed cost and variable cost? Give an example to illustrate.